Ernest Dwight is the coach for a Basketball team based in Las Vegas, Nevada. You happen to be the CFO of the Basketball team. Ernest needs to travel to San Diego, California on July 1 to perform a variety of professional functions prior to the team travelling to San Diego to play. If Ernest flies, he could catch a 6 a.m. flight on July 1. In order to perform all of his professional responsibilities, Ernest will need to spend the night and catch a flight on July 2 to return to Las Vegas. If Ernest flies, he will need to rent a car for $38 per day. To cover meals and other incidental expenses, Ernest will receive $45 per day (per diem) for each day he works out of town. Flights between Las Vegas and San Diego can be purchased for $89 one way.

Las Vegas is approximately 300 miles from San Diego, a 5-hour drive at speed limits permitted on the freeways connecting the two cities. If he drives from Las Vegas to San Diego, Ernest would need to leave the afternoon of June 30 and would be reimbursed $.50 per mile. He would need to spend 2 nights in a hotel, the night of June 30 and the night of July 1. He would return to Las Vegas by car on July 2. The hotel used by the team charges $160 per night.

What is the relevant cost of flying?

	a.	$414
	b.	$254
	c.	$459
	d.	$504

The activity rate for each cost pool is

	a.	computed as Total activity driver volume Total activity cost pool resources.
	b.	similar to the predetermined overhead rate calculation under traditional job order costing.
	c.	computed as part of the last step in the preparation of activity-based costing data.
	d.	similar to process costing.